Which of the Following Is an Example of an Adverse

question 105

Multiple Choice

Which of the following is an example of an adverse selection problem?

• A)A customer purchases four apples, two of which are bruised.
• B)A card shop puts its Halloween merchandise on sale on November 1st.
• C)A young job applicant fails to reveal that she was fired from her last job because she was incompetent.
• D)A man rents a car and then drives it less carefully and fills it with cheaper gas than he would if he owned it.

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Definitions:

Group Polarization Effect

The tendency for group discussion to amplify the initial leanings of group members, leading to a more extreme position.

Extreme Opinion

A viewpoint that is significantly far from the mainstream or moderate perspectives, often showing a high level of intensity or fervor.

Unethical

Pertaining to actions or behaviors that go against moral principles or professional standards.

Obedience

A form of social influence where an individual acts in response to a direct order from another individual, who is usually an authority figure.